Hablas Bonos? Translating Views Into Fixed Income

By iShares ETFs: I’ve been thinking a lot lately about translations. Not languages, though. Ideas. People who implement market views with stocks have historically hesitated to implement their views via bonds. Why? Because it’s hard to build bond portfolios by hand, one bond at a time. In the old days, if an investor had a view on corporate bonds, they’d have to research, price and source the bond themselves (potentially hundreds of times over, in order to achieve diversification). And if, for example, the investor wanted to shift out of corporate bonds and into another market, they’d have to research and build the new portfolio, not to mention go through the hassle and cost of liquidating the original portfolio of corporate bonds. Creating and managing a portfolio of hundreds of bonds is not easy. It doesn’t serve as great fodder for interesting dinner conversation, either. As a result, many investors turned to activeComplete Story »

Related

ByDavid Cretcher:
In my article Build a Reliable All-Weather ETF Portfolio with 4 ETFs, I cover how to construct an easy-to-manage portfolio by imagining building a sailboat comprised of a hull, a keel, a sail and auxiliary power.

Canadian investors this summer may be surprised by what they see on their account statements as a result of the implementation of CRM2, or Client Relationship Model Phase 2.
As at July 15, clients will be informed upfront about the cost side of their intended investments, which will provide more clarity around advisor compensation and costs. This will, in time, be followed by improved performance reporting.
The expectations surrounding CRM2 vary widely.

By iShares ETFs: In my last blog, I recapped 2011 and how it turned out to be the year of unmet investor expectations. Instead of interest rates rising, they fell. Instead of the municipal bond market suffering from widespread defaults, it fared better than in 2010.

Lowell Herr submits: Is it possible to build a portfolio that does not include U.S. stocks or international equities? The following portfolio was suggested by a reader and it originates from a well-known author. Here are the five ETFs that make up this conservative portfolio.

By VizMetrics:The recent Wall Street Journal article "A Portfolio That's as Simple as One, Two, Three" got us thinking about the possibilities of using just three ETFs to build a portfolio. But the article was sparse on examples. It provided only two specific portfolio allocation ideas: 1) 40% U.S.

By Tom Lydon:
As a response to the historical low yields and the threat of rising interest rates, BlackRock's iShares exchange traded fund arm has launched four defined-maturity-date corporate bond funds to help investors build a laddered fixed-income portfolio.

By Tom Lydon:
With Treasury yields at historical lows and no real guarantee that inflation won’t eat away at returns, corporate bonds and related exchange traded funds may be more attractive than U.S. Treasuries. In fact, corporate bond ETFs look cheap compared to Treasuries, says an industry strategist.

By Michael Johnston:In recent years, ETFs have become increasingly popular tools for accessing the fixed income corner of the market. The space initially grew much more slowly than equity ETFs, but investors have gradually become more comfortable with the combination of fixed income exposure and the exchange-traded structure.

MyPlanIQ submits:High dividend ETFs can be used to build an income producing portfolio that has lower risk, while achieving similar or higher total returns. This was demonstrated in our previous article and has strong academic research backings. We track a list of well known high dividend ETFs, including stocks and bonds.

Michael Johnston submits:Although most U.S. investors build their portfolios around a core of large cap domestic equities, small-cap firms, which generally have a market capitalization’s under $2 billion, are a vital component as well. Because small cap stocks tend to have smaller customer bases, shorter operating histories, and less cash on hand, they are often more volatile than their large cap counterparts. But because they possess greater growth potential, small caps also carry potential for greater returns.